Open automotive loans have now topped $1-trillion in the U.S. for the first time on record, announced Experian Automotive in a recent report.
The global information services company said the total balance of open automotive loans climbed 11.1 per cent in Q1 2016 to reach $1.005-trillion. That’s up from $905-billion in Q1 2015.
Lease balances have also skyrocketed and grew almost 28 per cent to an all-time high of $76.9-billion, up from $73.1-billion the previous year.
“Automotive financing certainly has started the year off with a bang, seeing steady growth in balances and loan volumes throughout the first quarter,” said Melinda Zabritski, Sr. director of automotive finance for Experian, in a written release.
“With more and more consumers relying on financing, it is important for lenders to keep a close eye on delinquency trends to ensure the market remains healthy. Likewise, consumers need to continue making their monthly payments on time to keep affordable financing options open and available.”
Though 30 and 60-day delinquency rates did increase, the Experian report found the overall percentage of total delinquent loans remain low when compared to pre-recession levels.
In Q1 2016, the percentage of loans and leases considered 30-days delinquent was 2.1 per cent, up from 2.02 per cent in Q1 2015. Only 0.61 per cent of loans and leases fall under 60-days delinquent, up from 0.57 per cent in Q1 2015.
